It does certainly appear that ownership and occupancy are used interchangeably without distinction.
A the bottom of this is an excerpt for IRS from 5695 instructions. There is a wide range of home types that are covered. While it might be implied or assumed, I don't actually read anything where it is specifically states (or defines home as such that) one must own the home to claim the credit - it just states you have to live there. Perhaps that definition is elsewhere? Or perhaps that is why the term (joint) occupancy is used instead of ownership?
Looking at the various types of homes in combination with owner occupancy possibilities, a few (of many possible) scenarios come to mind :
1. A large 3-story house that is split into 3 co-op type units that share a boiler that needs to be replaced or where exterior insulation is installed on common walls, etc., where costs are split by owner-occupants of each unit. Joint occupancy of the entire house where the improvments are made and apportionment of credit is useful and applicable I would think.
2. Where one domestic partner owns and occupies a house with a non-owner domestic partner and they share the cost of a new furnace 75/25, respectively (assuming a person has to live in the home and not own it to qualify for credit) . Joint occupancy and apportionment of credit is useful and applicable I would think allowing the non-owner occupant to claim some credit if this is the intent.
3. Two domestic partners own and occupy a single family home and one arranges and pays for a new furnace (only her name is on the invoice) and simply fills out 5695 and claims the entire credit on her return and the other partner does not file 5695 and takes no credit as there is no applicable need for apportionment because only one occupant is claiming credit.
Scenarios are perhaps only limited by imagination. But It seems like general intent of the form and instructions is to allow flexibility for various ownership and occupancy scenarios and to prevent multiple-dipping for the entire credit when it should be apportioned appropriately depending on specific circumstances.
Feel free to criticize this - it is just what I see when I read it and try to apply logic and reason.
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Who Can Take the Credits
You may be able to take the credits if you made energy saving improvements to your home located in the United States in 2024.
Home.
A home is where you lived in 2024 and can include a house, houseboat, mobile home, cooperative apartment, condominium, and a manufactured home that conforms to Federal Manufactured Home Construction and Safety Standards.
You must reduce the cost basis of your home if a residential energy credit is allowed for any expense for any property. The increase in the basis of the property that would result from the expenses will be reduced by the amount of the allowed credit.
Main home.
Your main home is generally the home where you live most of the time. A temporary absence due to special circumstances, such as illness, education, business, military service, or vacation, won't change your main home.
